Ocean Spray held it’s concentrate auction this morning and the prices dropped a little, only about 3%. While every drop in price is painful, I’m hoping the industry can absorb this without lowering the price to growers. Fingers crossed.
So I spent most of the weekend talking and reading about cranberries. After a second look at the CMC numbers, I must say that we have a boat load of cranberries to sell. Some people look at this crop and say it kinda mirrors the 2008 crop…big production everywhere. But really the US crop was in check and up “only” 200,000 barrels, where by the British Columbia and Quebec crops came in huge. The 2008 crop was followed by a down 2009 and 2010 crop which saved our collective backsides. The prices were recovering when 2012 happened. So here we are again.
No one in the US wants to do a volume regulation as long as Quebec and eastern Canada can bring in as much as they want to. BC has some mechanism whereby they mirror the US set aside, if we have one. So BC is playing along. I’ve heard that Quebec just isn’t there yet. If they don’t figure it out this year, they will when their bins are still full in October and they have another crop to harvest. We know, we’ve done this before in the US. So if you are from Quebec, please, please study up on this and get going. If everyone manages the crop together we can stablize prices. Otherwise we are going to pay the handlers to take them, and we all know who makes money in that situation. A whooshing sound right out of the growers pocket. And remember growers, some, not all handlers will be honest with you. Some will say that they need all this fruit because they want unfettered access to cheap fruit. Well, I may not know much, but even I can figure out that when we delivered a US and foreign acquired crop of 10,000,000 barrels and we sell about 8,500,000 barrels a year there is plenty of fruit to go around.
My other thought was about foreign markets and SDCs. Really, you have to give it to Ocean Spray with that Cran Chile acquistion. They are going to get access to markets without a tariff as Chile has a bunch of free trade partners, as does Canada. So their fruit from those areas can be exported cheaply. The rest of our handlers will have to pay some steep tariffs. Not all of OS’s handle will export cheaply, but they will have an advantage. So, I guess, I say…begrudgingly…good for them. Get those cranberries consumed around the world. I also know that the other SDC guys, Marianni, Decas and Graceland are all overseas too, so it isn’t all about price. It is about the quality of product and the price to convert, so lets go! Lets teach the world about the healthy cranberry! Let’s work together to make the MAP funds and CMC funds make something happen overseas.
So today was the trade show and first day of the Wisconsin Winter growers meeting. Since United Cranberry had a booth, our director Tim Feit and I spent some time talking to growers and vendors alike.
EVERY grower was glad for this cold spell…it is the coldest bit of weather that we’ve had in probably 3 years and everyone is glad to be making some quality ice. I think we will be sanding soon. And since our personal lack of sand the last few years has been a running joke amongst a few, so there! Ice!
Otherwise, the independent growers are worried about price. And they should be! The OS auction is next week and they have already predicted a price for their 2012 B pool at $16-21. It is my understanding that all the B pool fruit goes into the auction, so they must have figured out how much everyone is going to bid? Is that mental telepathy or what? Go figure.
It was great seeing everyone. United Cranberry is working on some interesting projects that we hope to be able to tell you about soon. Keep warm and be safe.
So the CMC sent out the Q1 report on the cranberry inventory AND the 10 comparative report. Yikes. There is some good news and bad news. If any one ever wondered if we can grow cranberries…the answer is YES! And apparently Canada can as well. The crop was up in every growing area or even with last year. The bad news, is we have quite a few berries in the freezers. While this report doesn’t distinquish between independent and Ocean Spray, suffice it to say, everyone has cranberries.
So, got ideas? We need a marketing program ASAP. I think that will be the focus of the CMC meeting in Tampa in late February.
So it looks like the plaintiffs have amended their filing…added some growers and got more specific about things. Interesting reading. I don’t think Ocean Spray has responded yet. On first glance, I noticed that Ocean Spray must have cancelled one of the B pool growers contracts, saying that they (OS) didn’t want to do business with them. The plaintiffs are asking that OS not be able to do that anymore, as this suit goes forward. Read on!
I haven’t seen it in the stores, but I keep looking!
- Improving our ability to produce and efficiently distribute dried cranberries from a strategic South American location to new and existing international markets.
- Increasing Ocean Spray’s capacity to produce dried cranberries by approximately 6 percent, or 12 million pounds annually.
- Providing a valuable source of counter-seasonal cranberries.